Medbox Inc (OTCMKTS:MDBX) Extends Big Green Streak
After scraping two-year lows dangerously close to a dime per share, Medbox Inc (OTCMKTS:MDBX) seems to have gone on a bit of a recovery streak. After a devastating slide that sliced over 90% of MDBX‘s share price over the last three months alone, the stock closed up in double digits on the last session ahead of the long weekend, then continued running up.
In three consecutive sessions MDBX more than doubled, climbing from $0.11 to $0.25 per share. The reversal started before MDBX‘s July 6 press release, which means it was not initially triggered by it, even though the news no doubt helped, with a 50% green close on the day it hit the wire.
MDBX announced the appointment of Mr. Jeff Goh as president and interim CEO of the company. He was formerly COO of the company and replaced Guy Marsala in the CEO spot. Marsala also vacated his spot on MDBX‘s board of directors concurrently with handing over the CEO position. The PR spoke of the beginning of a new era that will prove MDBX is among the leaders of the cannabis industry.
The company will need to show far better performance in its upcoming reports if it plans to deliver on this. For the first three months of 2015 the company generated a very modest $41 thousand in revenues and logged significant net loss of $4.4 million.
The reason why MDBX reversed might be technical as well. Through half of June the stock was becoming ever more oversold. Assuming the Jul 2 reversal was technical, this could have attracted more traders who may want to aggressively play the bounce and this could further distort the picture painted by the recent triple-digit bounce.
Everyone who has considered investing in Medbox should be well aware of the reason why the company dropped from over $5 per share to just over $0.10 in 2015. MDBX became the subject of a SEC investigation and had to restate a number of financial reports that contained revenue recognition errors. The new reports showed significant differences that led to far greater net losses.
